The US Commodity Futures Trading Commission (CFTC) announced on Wednesday that it filed and settled charges against Societe Generale, a leading financial services provider based in France, for swap valuation data and supervision failures.<\/p>\n
According to the press release, the French banking services provider failed to comply with certain swap dealer requirements for disclosing mid-market marks to counterparties and reported inaccurate swap valuation data to a swaps data repository. The order stated that between 2013 and July 2021, Societe Generale committed such violations to the CFTC regulations, as it adjusted such daily marks for profit, hedging, or other legally impermissible costs or adjustments.<\/p>\n
\u201cThe order also finds that Soci\u00e9t\u00e9 G\u00e9n\u00e9rale failed to report certain swap valuation data to an SDR accurately. Soci\u00e9t\u00e9 G\u00e9n\u00e9rale also failed to maintain an adequate supervisory system and failed to perform its supervisory obligations diligently with respect to mid-market mark disclosures,\u201d the CFTC noted.<\/p>\n
That said, the authority imposed a $1,500,000 civil monetary penalty and issued a cease and desist order while asking Societe Generale to meet the compliance requirements on time. \u201cThis is another in a series of cases the CFTC has brought highlighting the need for swap dealer registrants to have an adequate supervisory system and controls in place. Swap dealer registrants must ensure that they make complete and accurate disclosures to counterparties and accurately report swap valuation data to SDRs, and must also diligently perform their supervisory duties,\u201d Vincent McGonagle, CFTC\u2019s Acting Director of Enforcement, commented on the matter.<\/p>\n
For a similar situation, the CFTC recently filed and settled charges against Citibank and Citigroup Global Markets Limited for failing to comply with certain swap dealer requirements. The watchdog argued that Citi did not allegedly report the Legal Entity Identifier (LEI) data to a swap repository known as SDR, among other supervision failures.<\/p>\n